Many days ago a contractor came over to my office to put up a quote for some renovation work. As we were having lunch together, he asked my opinion as to whether he should withdraw part of his EPF as he is already above 50 years old. I asked him why he wanted to do so and he said he didn’t have much money in his EPF which was deposited during his younger days when he was wage earner. He stopped contributing to EPF when he started up his own renovation business. He was sick about the pitiful dividends paid by EPF over the past few years.
This happened just before EPF announced the quite decent 5.65% dividends for 2009 just some days ago. I’m not a financial expert and this guy is very much elder than me so I didn’t give him any advice but asked him how well he can manage the money should he decided to withdraw them. He was unsure and said that probably he would invest in the share market. I told him that as far as I’m concerned, EPF is a saving for retirement and therefore it should not be touched until you are retired. Share market is just like Russian roulette, you make big buck sometimes, and you can go kaput some other time. This chap although not very highly educated agreed with me on that point and said that he would leave his EPF alone until he retire.
I’m glad that he listens to me. Survey from EPF indicated that most of the contributors finish off their money 3 years after withdrawal and ended up in misery. Of course I will still curse and swear whenever EPF is giving poor dividends but I don’t think any ordinary person can manage a big sum of money that efficiently giving that we do not have the knowledge and discipline to do it. So let’s leave your EPF alone and join me in swearing at the government if EPF give us poor dividend next year. This year just give them a big clap, 5.65% not too bad in the light of global financial crisis.
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